In 2012, profits per passenger were about $4 [0] But lately, North American airlines are making over $20 per passenger [1]

[0] http://www.economist.com/blogs/economist-explains/2014/02/ec...

[1] Economist, April 22 print edition, page 11

They also won't have to pay the people who get bumped which will somewhat offset the lost revenue from overbooking.

I was under the impression they didn't actually pay people bumped, only gave them a voucher for their next flight that they probably won't even use.

Do they actually give cash?

They give flight vouchers, but they often have other direct expenses like hotel accommodations and food.

The last time I was bumped it was ~$600 airline voucher, transportation to/from a ski resort (a perk of being bumped in the mountains!), a room for the night and a good meal voucher to cover dinner and breakfast the next day. Plus they still flew me out the next day and took care of rebooking the connection on another airline. I don't know exactly how much it cost them, but I made out like a bandit.

I can better that. In the early 90s I (12) and a schoolmate (17) were flying vancouver-toronto-london with BA. I as an unaccompanied minor, him no so. The toronto-london flight was delayed overnight due to mechanical issues. They probably wouldn't have helped my friend so much but when I mentioned there was an older student on the flight from the same school they tracked him down. We got two hotel rooms and, this sounds strange but true, a stewardess. She took us to visit the University of Toronto, to which my friend was applying, and then the CN tower before our flight the following night.

Not recently. Costs have plummeted and airlines are one of the more profitable industries these days.

Historically airlines are one of the least profitable businesses in history. A few good years doesn't change that much.

In the US at least, they are now considered as a commodity. But the consolidation of major carriers (American with US Air, United with Continental) may have changed that equation.